Military Retirement & Pension Benefits in New York (2024)

Military members serve their community, protect American interests, and sacrifice time with their loved ones. When they reach the end of their career, it is important that their service is honored and that they receive the retirement benefits they deserve.

Understanding military retirement benefits can help them plan for their future, including:

• Creating a budget with how much they will receive
• Knowing how their benefits will be impacted in the event of a divorce
• Creating an estate plan to secure their assets

If you are a military veteran or are an active service member approaching your retirement date, an accomplished retirement and pension attorney from Trotto Law Firm, P.C., can help you create a plan for how to move forward.

Military Retirement Plans

When a service member enters the military, they will have access to various retirement plans, depending on factors like when they entered the service. Each plan is unique and calculates the amount of retirement that a veteran will receive differently. Knowing this information prior to retirement can help veterans make informed decisions while estate planning.

The five retirement plans that are currently active for military service members include:

• Final Pay: This plan is applicable to anyone who joined the military before September 8, 1980. The amount of retirement that those who retire under this plan will receive is determined by a specific formula. To calculate the amount, they will multiply the number of years they served by 2.5%. Then, once that amount has been found, multiply it by the basic monthly pay on the day of their retirement.
• High-36: This plan is similar to the previous plan, but the retiree will calculate their benefits by multiplying the number of years they served by 2.5%, then multiplying that number by the average basic pay for their highest 36 months of pay. The High-36 plan applies to anyone who enlisted between September 8, 1980, and August 1, 1986. Individuals who joined after August 1, 1986, and did not choose the CSB/REDUX plan would also be enrolled in this retirement plan.
• CSB/REDUX: The full name of this plan is REDUX, with a Career Status Bonus (CSB) and it is available to anyone who entered the service between August 1, 1986, and January 1, 2003, and chose the Career Status Bonus. Any service member who retired after age 62 will use the same formula as the High-36 plan, while those who retire prior to age 62 will multiply their years of service by 2.5%, subtract 1.0% for every year less than 30 years of service, then multiply that number of the average of the highest 36 months of basic pay. In addition to that benefit, those who are part of the CSB/REDUX plan will receive a lump sum of $30,000 when they have served 15 years, so long as they commit to serving through 20 years.
• BRS: This is the Blended Retirement System for those who joined before December 31, 2017, and opted into this plan or anyone who joined after January 1, 2018. The benefit is calculated by multiplying their years of service by 2.0%, then multiplying that by the highest 36 months of basic pay. In addition to the retirement benefit, those who are enrolled in this plan will also receive 1.0% of their base pay put into a tax-advantaged retirement account after 60 days.
• Disability: This is the only plan that is not based on when someone enlisted in the service but rather on their disability status. Anyone who was medically discharged from the military with a disability rating from the DOD of at least 30% is eligible for this plan. A total disability benefit will be determined by multiplying their base pay by a certain percentage, both of which will be based on which retirement plan they would have been enrolled in.

FAQs About New York Military Retirement & Pension Benefits

Will Retired Military Get a Cost-of-Living Increase for 2024?

Inflation can be frustrating to deal with, especially if you are on a fixed income like retirement. The Defense Finance and Accounting Service, which is the organization responsible for all payments from the Department of Defense, takes that into account when determining the need for a Cost of Living increase. Veterans receiving military retirement will receive an 8.7% cost of living increase for 2024, beginning in December 2022.

What Is the Proposed 2024 Military Retirement Pay?

The retirement pay that you will receive as a veteran is dependent on many factors, including when you joined the service, how long you served, and what retirement plan you chose. For example, veterans on the Final Pay plan can calculate their retirement pay by multiplying their years of service by 2.5, then multiplying that total by their pay on the day of retirement. Other plans will calculate the retirement pay differently, so an estate planning attorney can help you understand your plan.

How Are Military Retirement Plans Structured?

There are several retirement plans available for military veterans, but their availability is often dictated by the length of the veteran’s career and when they entered the service. The military currently has five different retirement plans active, most of them defined by when the individual began their tenure in the military. The plans are Final Pay, High-36, CSB/REDUX, Blended Retirement System, and Disability. The Disability plan is the only one that does not rely on their entry date but rather on if the veteran was deemed medically unfit for service.

Will Military Retirees Get a Pay Raise in 2024?

There is a proposed military pay raise for 2024, which includes a 5.2% pay increase for military personnel. While this is a deserved pay increase, it will not apply to retirees receiving military retirement. The pay raise is for active military personnel only, so it does not apply to retirees or civilians who work for the federal government. Retired military personnel will get an increase to their payments for 2024, however, in the form of a Cost of Living increase.

Trust Trotto Law Firm, P.C., to Help You Understand Your Military Retirement

You served your country proudly, have reached the end of your career, and are looking forward to enjoying your retirement. It is important to be prepared for any eventuality once you retire from the military, including planning for the end of your life. An experienced estate planning attorney can help you understand what you are entitled to, whether your pension and retirement benefits will be impacted in a divorce, and how to ensure that your assets are protected when you pass. The team at Trotto Law Firm, P.C., is ready to assist you. Contact our office today with any military retirement or estate planning concerns.